Hidden Risks of Crisis Leadership

September 14, 2009
by Frances Frei

The NYT’s Adam Bryant delivered an interesting interview with Lloyd Blankfein, CEO of Goldman Sachs. Blankfein offers some suggestions for leading in a crisis, which can be summarized as keep talking, to everyone, both to better inform your choices and to communicate changing conditions and strategies. Blankfein walked the halls constantly during the height of the financial crisis and left a daily voicemail for the entire organization.

Blankfein also speaks to the need to “be good” to your people without lowering standards, a theme I explored in an earlier post. In his words:

…being good to them doesn’t mean you pay them more or you’re more liberal, or you let them get away with things. Most people, what they want is to be better.

Getting this right is a central part of good leadership, but it’s harder to do in a crisis. There is often intense pressure to care too little about your people — to become distracted by anxiety and external events — or to care too much and lower your expectations of their performance. The first reaction is more common, but the second is more insidious.

Anxiety is a deeply selfish emotion. We don’t think of it that way because it’s often threats to other people that trigger the sensation, but anxiety’s unique rush of hormones and chemicals is biologically designed to promote our own survival. The response is self-distracting, by design. It’s almost impossible to focus on the experience of other people in these moments, to perform the very act that makes leadership possible, and so we end up hardening ourselves to the people who need us most. Anxiety is an indulgence that destroys our capacity to lead.

In contrast, a crisis tempts some of us to become overly sympathetic and lower our standards. When people you care about are going through a tough time, it can feel reasonable to compromise and let them off the hook a bit. But there are two significant costs to that choice. First, it denies your team the opportunity to learn. People, like muscles, need to push themselves beyond their comfort zone to grow. They need to bump up against their perceived limits in order to break through them, and protecting them from reality disrupts that growth process. Second, lowering standards signals your hidden belief that maybe they’re not up for it after all. It reveals a lack of confidence in your people when the stakes really matter. They will internalize the message. Their performance will rise only to the level of your diminished expectations, and everyone will conclude that you were right. It is hard for organizations to recover from those dynamics.

A provocative way to think about it is that a crisis tempts us all to become anxious mothers or protective fathers. Leadership requires that we reject both of these unproductive stereotypes.